Islamic bond boosts Saudi Arabias Sabbs capital to meet regulatory requirements
Sabb (formerly Saudi British Bank) has closed a SR1.5bn ($400m) sukuk (Islamic bond) aimed at boosting the banks capital.
The bank, an affiliate of HSBC Holdings, raised the Islamic bond to establish a capital base that will ensure it complies with new banking regulations known as Basel III.
The issuance has a seven-year tenor and is priced at 1.4 per cent over ther Saudi Arabia interbank offered rate (Saibor), read a statement from the Saudi Stock Exchange (Tadawul).
Sabbs sukuk closely follows a SR2.5bn, 10-year subordinated sukuk issued by Saudi Hollandi Bank. This sukuk was priced at 1.55 per cent over Saibor.
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